Divorce can take a profound emotional toll on families. Financial concerns arise when retirement, IRAs, and a 401K come into play. How can couples ensure during an amicable divorce that their assets are protected? Can one spouse lose their pension or retirement to another?
This blog explores the questions about the division of assets and the financial implications of divorce. It offers solutions to protect your assets and uphold your fair share of asset division during a divorce.
When it comes to dividing assets in a divorce, pensions can be a tricky issue. For the most part, pensions are considered joint marital assets, meaning they will be split between the divorcing spouses. However, there are some exceptions to this rule. For instance, if a pension was earned before the marriage, it may be considered an individual asset. Additionally, state laws affect how pensions are divided in a divorce.
Timing is essential when considering a pension or retirement during a divorce. Via a court order named qualified domestic relations order (QDRO), a spouse must specifically ask for a division of assets at the time of divorce vs. the time of retirement.
In Ohio, the division of retirement benefits in a divorce depends on whether an employer provides the benefits. If they are, they are subject to federal law, specifically the Employee Retirement Income Security Act, better known as ERISA. ERISA governs the division of employer-provided retirement benefits in a divorce.
ERISA generally requires that employer-provided retirement benefits be divided in a divorce according to the plan’s terms. However, there are some exceptions. For example, if a couple has been married for less than ten years, then ERISA does not apply, and the benefits can be divided according to state law. Additionally, if a couple has been married for ten years or more, one spouse is entitled to receive benefits under the other spouse’s plan. The advantages must be divided following ERISA.
According to state law, other assets like a 401K are classified as marital property and subject to division in a divorce. However, there may be some exceptions depending on the specific circumstances of a case. When dividing financial assets during a divorce, there are many variables and moving parts. Contact our lawyers for a confidential consultation to ensure your pension is protected, and your rights are upheld during the divorce process.
A pension is often one of the most valuable assets in a divorce. It’s essential to ensure you understand what options are available to you and how to protect your interests. We want to help our clients get through their divorces as smoothly as possible. We know this can be a difficult time, but we are here to guide you through it every step.
If you are going through a divorce and have questions about your pension, don’t hesitate to contact us for a confidential consultation. Our divorce attorneys would happily talk to you and help you understand your options.
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